LOONY TUNES TRADING FORCES A CHANGE

 

“Hey Elmer … ever think of huntin’ something else except Wabbits?”

I’ll cut right to the chase today … the last 2 weeks or so, maybe 3 -4, a 

transformation has taken place in EURUSD; and like somebody switching a 

light on/off, that market has gone from tradeable to non-tradeable. Quite 

frankly, I’m not gonna sit around and get obliterated with slippage, where 

once again today, the scumbag LP’s picked our pocket good … but, it’s not 

only us, there are plenty of others getting hurt worse than us. And what makes 

it particularly vicious are the price quotes that go 3 - 5+ PIPS in less time than 

you can blink your eyes … “you know what? I don’t need shit like this served to 

me on a daily basis by a group of scumbag LP thieves, and then have them tell me 

all is “fair” … if I want slippage, and get robbed every day, I’ll go hang out at a 

7-11 at 1 A.M. and ask people if they’d like a free “hug” … seriously".

So, I did some GBPJPY trades today, and just like EURUSD, in a market 

that’s going down, while I’m short and the market is falling, I hit the liquidate 

button and get filled 2.6 PIPS higher than the offer that was there when I 

clicked the liquidate button… “WTF”! … And I’m thinkin’, “OK, if that’s the 

new paradigm going forward [kill ‘em with stops & slippage], I’ll go someplace 

else”. 

“And so, it’s time to leave Wabbit hunting for Elmer Fudd and gang”!

In case you haven’t noticed, the “volatility horses are out of the barn in the 

stock indices”, and the markets [SP500 & DOW30] are back to their old 

selves … and while the “Plunge Protection Team” [PPT] is still around, the 

FED “put” against lower stock indices prices is done and over … so, why 

shouldn’t I be trading this now, especially the DOW30? Slippage, when it 

occurs, isn’t any worse than what I’m getting in EURUSD or today in 

GBPJPY [“hell, if I’m short and the market is moving lower, how the hell do I 

get a fill 2.6 PIPS above the offer I just saw when I hit the liquidate button”?]

One of the worse things you can do as a trader is to become married to a 

market … well, that ain’t gonna happen to me, and I have a distinct feeling 

EURUSD is stuck in a 200 something PIP range for the foreseeable future, 

with as much risk and maybe more, than trading the DOW30. 

So, I’m back to trading the DOW30, and while the spread remains 2 DOW 

points [nothing], I’ll be looking for more than scalp trades here going forward. 

I’m adding it to “The Magnificent Seven”, and I’ll be calling this new group,  

“The Crazy Eight”. And as long as the market doesn’t go “sleepy” on us 

[doubtful now], it will treat us better and we’ll make more money than 

EURUSD could ever hope to make us … all with less slippage and risk.

Turning to today’s trading … EURUSD and most of the FX crosses, have 

become illiquid traps, doling out nothing but stops & slippage … scalping is 

impossible with 5+ PIP ticks up/down, and then add the slippage … might as 

well be trading Mexican Peso / Turkish Lira for the risk you’re taking. “Well, 

screw that”.

A blizzard of trades today … PAMM down approximately $280, which is 

about 0.5%. Incidentally, all of today's loss was the result of EURUSD, and the problems I mentioned above, where at least half was due to slippage; 
Dow 30 trading was profitable. 
  
And while I’m never happy about being down even a nickel, given the scope 

of the problems in EURUSD & other FX via slippage on fills that shouldn’t be 

having problems, and the fact that intraday volatility in the DOW30 is 

somewhat crazy, with 100+ point swings in a handful of minutes, being down 

a couple hundred bucks feels like victory … in some ways it is, cuz it’s only a 

paper cut, and can be made back fairly easily.

I will remind people what I have said for ages, which is when left alone by the 

central bank manipulators, and allowed to fluctuate normally, with both 

buyers and sellers represented in the marketplace, both the DOW30 & the 

SP500 can be wonderful trading instruments giving us shiploads of profits 

… hopefully, the grand experiment in central bank hubris of attempting to 

manipulate stocks higher every single day no matter what, is finally over 

… we’ll see, but whatever the case, it can’t be any worse in the DOW30 than 

it is in EURUSD, and the DOW30 surely has higher intraday volatility at the 

moment, “So, fasten your seatbelts cuz we’re headed back to the DOW30 for 

some heated trading”.

I’ll have the PAMM spreadsheet updated after tomorrow, cuz it’s gonna take 

me tonight to get caught up with all the trades today; I just didn’t have time to 

spreadsheet them. In addition, I’ll be trading the DOW30 from the European 

open going forward, so plenty of time to capture some of the day’s trend both 

before the U.S. market opens and during New York trading hours. Look for 

my daily blogs to be posted around 15 - 30 minutes after the close of trading at 

the NYSE, which is 4 P.M. EST.

Of course, we don’t need to see 500+ point DOW30 ranges every day to make 

things profitable, just 100+ in the NYSE New York hours will do, and we 

certainly have seen that lately in spades… and I expect it to continue into the 

foreseeable future cuz there are a whole host of issues affecting world indices 

at the moment that show no signs of abating or going away … that means up & 

down, which is how it should have been since Feb. 2016 - Jan. 2018, but wasn’t. 

Now that the volatility goblins are on the loose, they aren’t gonna be put back 

into the FED bottle nice & neat … that spells plenty of opportunity for us here 

in this market … it’s nice to be back trading it. 

So, I put my “big girl panties” back on, shut the hell up about FX slippage and 

 “fugetaboutit” cuz it’s water under the bridge, and let the profits pile up in the 

DOW30 … I’m outta here … until tomorrow mi amigos 

… Onward & Upward!!

PAMM spreadsheet tomorrow, with all of today's action, plus Friday's trades.

UPDATE On the close: Dow down 750+ points for the day. I don’t ever trade 
the last half hour of trading, simply cuz there is no room to maneuver if you’re 
wrong to make anything back. Still … “yea, volatility is back … won’t Asia be 
interesting tonight, and I’ll be there … you can sleep when you’re dead”!  

Have a great day everybody!

-vegas

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